Plastic exports may grow 25% in FY22, says Plexconcil chairman

Favourable market conditions and increasing demand for domestic goods in key destinations such as the US and Europe are said to be the driving factors.

05 Jul 2021 | By PrintWeek Team

According to Arvind Goenka, chairman of Plastics Export Promotion Council of India (Plexconcil), India's plastic exports are expected to grow 20-25% to USD 12 billion in the current fiscal year on account of favourable market conditions and increasing demand for domestic goods in key destinations such as the US and Europe.

Goenka said though the order books of exporters are healthy, government support is needed in certain areas to further push exports as the sector holds huge potential to create jobs.

"In 2021-22, we are expecting a growth of 20-25% in exports. It should touch USD 12 billion from USD 9.5 billion in 2020-21. During April-May this fiscal year, we exported goods worth about USD 1 billion. Government support will help us in boosting exports significantly," he said.

However, he admitted that the sector is facing challenges such as inadequate availability and rising rates of raw materials (polymers), increasing shipping freight, container shortage, and inverted duty structure due to certain free trade agreements. Inverted duty structure refers to taxation of inputs at higher rates than finished products that results in build-up of credits and cascading costs.

Thailand and Vietnam, members of Asean with which India has a free trade pact, are key players in the sector and they are getting preferential access in the Indian markets due to the agreement, he said.

Goenka said plastic consumption is growing at a faster rate, but “polymer production is not increasing at that pace due to which manufacturers are facing huge shortages of raw material”.

According to Goenka, China's annual export from the sector is about USD 70 billion; global exports stand at USD 1 trillion. The US and Europe markets account for 50% of the country's total plastic exports.

Inputs from agencies